Tuesday, November 6, 2012

Effective November 6, Visa has expanded their program allowing government agencies to add a service fee Visa card payments to include Higher Education. This is potentially big news for every school that accepts or wants to accept payment cards for payment of tuition and fees. Visa's statement reads in part:

To regain acceptance and increase competitiveness in the Government and Higher Education segments, effective 6 November 2012, Visa is expanding the Tax Payment Program and renaming it the Government and Higher Education Payment Program. The expanded program will include government merchants (Merchant Category Code [MCC] 9311—Tax; MCC 9222—Fines; MCC 9211—Court Costs; and MCC 9399—Miscellaneous Government Services) and tuition and related payments for higher education (MCC 8220—College Tuition; MCC 8244—Business; and MCC 8249—Trade Schools).

Visa currently does not permit variable fees on any type of U.S. payment transaction, other than on tax payment transactions. By expanding the Tax Payment Program, Visa seeks to regain lost Visa acceptance among higher education and government merchants.

Here are some of the details:

This is not a new program. Rather, it expands the current program allowing surcharges for government agencies to additional merchant category codes that include Higher Education.

The program includes card-present as well as card-not-present transactions

The program includes credit and debit cards

If your school wants to participate, you have to do a couple of things:

First, your institution has to register with your acquirer. You should contact your acquirer to get the Government and Higher Education Payment Program Guide, which has the form you need to file to register for the program. This guide also has all the program details. Note there is no fee for the registration, but your institution has to do it.

While you are talking with your acquirer, make sure they have assigned you the right Merchant Category Code (MCC). This program only applies to transactions in MCCs 8220 (College Tuition), 8244 (Business schools), and 8249 (Trade schools). This is important, and you may need to hold your account rep's hand through this process. In my experience, schools may be classified into MCC 8299 (Miscellaneous education). If that is you, then you need to get your MCC changed or you will not benefit from the program.

The payment and service fee transactions must be submitted and processed as two separate transactions as noted below:

The transaction must include:

The higher education institution (merchant) name in the Merchant Name field (merchant name cannot exceed 25 characters in length)

Customer support phone number in the Merchant City field

State of the merchant in the Merchant State field

The service fee transaction must include:

Merchant or service provider name in the first 3,7, or 12 positions followed by an asterisk (*) in the next position, followed by the words “Service Fee

Customer support phone number in the Merchant City field

State of the service provider in the Merchant State field.

There are some other conditions described in the Program Guide, but they are not out of the ordinary.

All of this means that those institutions that had not accepted Visa in the past because of the service fee prohibition are free to add that card brand. All you need to do is register with your acquirer.

This is potentially big news for many institutions. Spread the word. Please feel free to post links to this post to listserves and bulletin boards as you wish.

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This blog addresses all things PCI. It is designed for Higher Education institutions and their unique PCI and security needs, but all merchants, developers, and processors are welcome. Thanks to the Treasury Institute and NACUBO for making this blog and the PCI Workshops possible.